N.J. Treasurer Says Low Earners Pay Less Than Neighbors

March 30 (Bloomberg) -- New Jersey residents earning less
than $150,000 pay lower income taxes than people in nearby
states, including New York and Connecticut, while top earners
pay a higher rate, Treasurer Andrew Sidamon-Eristoff said.

The state’s revenue is “volatile” because of its
progressive income tax, which is more dependent on the highest
earners, Sidamon-Eristoff said. That means New Jersey suffers
more than other states during an economic slowdown and
outperforms during a recovery, he said during a breakfast with
business owners in Monroe.

Governor Chris Christie, 49, a first-term Republican, is
banking on a 7.3 percent jump in revenue to fund a $32.1 billion
budget in the year starting July 1 and his 10 percent income-tax
cut for all residents. As a projected economic recovery takes
hold, gains made by those earners paying more taxes will allow
New Jersey to outpace its neighbors, Sidamon-Eristoff said.

Under New Jersey’s income-tax structure, which increases
the rate as income rises, the top 1 percent of earners pay 38
percent of all taxes, Sidamon-Eristoff said. Those earning $1
million pay more than their neighbors, according to a chart
provided by the treasurer’s office.

“We get huge swings as a result of the greater economy,”
the treasurer said. “Because we are so progressive, it’s
extremely volatile as a revenue base.”